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How to buy Real Estate in the Dominican Republic?

Informative -

Buying Real Estate in the Dominican Republic is a pretty straight forward process but for the security of your investment in the Dominican Republic, I will detail you every important step you have to consider when buying a property. Please make sure you have a trustworthy Lawyer and Real Estate Advisor to handle your transaction and make sure there are no complications with your investment.

Please don’t invest without proper knowledge and trustworthy contacts, take your time, and make sure you take the proper steps for a successful investment.


Preliminary aspects: It is recommended that the buyer ensures that the Real Estate Agent has a law firm and notaries since the few guarantees in the system for the buyer, it is necessary to check all the information necessary to ensure the rights of the buyer, before the signing of the Promise of Sale, but conditioning its execution to the results of the pertinent legal verifications.

The Promise of Sale: The real estate operations must begin with the subscription of a Promise of Sale or Option to Purchase, by virtue of which the buyer delivers a deposit, advance or reservation to the seller or to a third party and the seller agrees to sell his property to the buyer, under the terms contemplated in the Promise or Option. The contract is signed by the parties in the presence of a Notary, who legalizes the signatures. The Promise or Option must contain a detailed description of all the relevant aspects of the negotiation, such as the description of the property, the sale price, the form of payment, the guarantees, the causes of resolution, etc., as its function It is to regulate the sale from its beginnings until the payment of the price is completed and the Sale Contract is signed, which will serve to transfer the property to the buyer.

A well-written Promise of Sale must contain the following information and minimum mentions:

(a) Full and general names of the parts. If the seller is married, the signature of his spouse will be required.

(b) Cadastral description of the property being sold.

(c) Sale price and method of payment.

(d) Termination clause in case of non-payment, if agreed.

(e) Date of delivery of the property.

(f) List of legal checks to be carried out regarding the state of the property and conditioning of payments to the positive result of said verifications.

(g) Obligation of the seller to sign the Purchase Agreement upon receipt of the entire sale price payment.

The Purchase Agreement: Like the Promise or Option, the Purchase Agreement is signed before a Notary Public who legalizes the signatures of the parties. Its purpose is to transfer the property right from the seller to the buyer.

Determination and payment of transfer and registration taxes: The Purchase Agreement must be deposited with the Local Administration of the General Directorate of Internal Taxes, to request the appraisal of the property purchased. The Local Administration of the General Directorate of Internal Taxes verifies if the seller is up to date in the fulfillment of his fiscal obligations, and commissions an inspector to appraise the property and determine the amount of taxes to pay. This procedure can take several days or several weeks.

Registration of the sale in the Registry of Titles: Obtained the appraisal of the property and paid the transfer taxes, the Contract of Sale and the Certificate of Title of the property sold must be deposited, together with the documentation provided by the Local Administration of the General Directorate of Internal Taxes, in the Title Registry corresponding to the jurisdiction where the property purchased is located.

• Issuance of the Certificate of Title: Once the sale is registered in the corresponding Title Registry, a new Certificate of Title is issued in the name of the buyer and the Certificate previously issued to the seller is canceled. It is important to highlight that the buyer’s right of ownership exists from the moment the purchase is registered. The issuance of the new Certificate of Title can take from a few days to several months, depending on the Title Registry office in question.

To initiate place checks, the seller must provide the buyer or their legal advisor with the following documents:

Investigation in the Registry of Titles: The lawyer must have a certification issued by the Registry of Title stating the legal status of the property.

Verification by a surveyor: An independent surveyor or surveyor must always be hired to verify that the property to be purchased is the same as that shown in the plan presented by the seller unless it is previously verified developments. There have been cases in which, for reasons of errors in the measurement or by fraudulent maneuvers of the seller, the property presented to the buyer is not the same as that stated in the Certificate of Title. It is advisable to check the plan even in the case of demarcated or subdivided land with the approval of the General Directorate of Cadastre Measurements.

Permits: The buyer’s attorney must confirm that the property being purchased can be used for the desired purposes. Although urban planning in the Dominican Republic is very poor, there are many legal restrictions that must be taken into account before making the purchase. For example, Law 305 of 1968 establishes a 60-meter maritime zone, starting at high tide, along the entire coast of the country, which in effect brings all Dominican beaches into the public domain. Constructions are not allowed within the maritime zone without special authorization from the Executive Power. In addition, in tourist areas, there are construction restrictions administered by the Secretary of State for Tourism.

Possesion: The lawyer must verify that the seller is in possession of the property to be purchased and that there are no occupants or improvements belonging to third parties. Special care should be taken in the case of properties that are not fenced and that are outside of known developments. It is recommended to close them before concluding the business in order to discover in advance any claim from third parties. If there are tenants, tenants or settlers in the property, the buyer must be informed that Dominican law overprotects these people and that, consequently, evoking them could be an arduous and expensive task.

Employees: The seller must pay the labor benefits corresponding to the employees related to the exploitation of the property being purchased.

Services: The lawyer in charge of the operation must verify that the seller has no outstanding debts for water, electricity, telephone, cable or other services.

Expenses and fees to transfer the property:

The expenses for the transfer of the property from the seller to the buyer amount to approximately 3.1% of the market value of the property, broken down as follows:

• 3% for the property transfer tax (Law # 288-04)

• Minor expenses for various stamps, such as check or stub certification, stamps, tips, etc.
It should be emphasized that taxes are calculated on the market value of the transferred property (Article 20 of Law # 288-04), by means of appraisal made by the government authorities, and not on the price stipulated in the Sales Contract as in many countries.

As for professional fees, the standard rate is 1% of the purchase price, which normally includes advice on the negotiation of the purchase, the steps required to check the status of the property, the writing of the Promise to Sell and the Purchase Agreement, as well as its legalization before a Notary, the payment of transfer taxes, the registration of the Purchase Agreement in the Title Registry and the withdrawal of the Certificate of Title issued in the name of the buyer. The responsibilities of the Lawyer-Notary in the Dominican Republic, therefore, correspond to those that in Spain are the responsibility of the Lawyer, the Notary, and the Collegiate Administrative Manager.

(Real Estate Agent Fees are usually paid by the Seller so don’t hesitate on reaching out to your favorite Real Estate Agent or Brokerage)

I hope this blog about how to buy Real Estate in the Dominican Republic was helpful and informative to you if you have any questions leave them down in the comments at the end of this Blog.

Check out these links below to other amazing blogs all from the Dominican Republic beautiful wonders.

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